Sandy's gift for 2013: Tax hikes

Dec. 24, 2012

Toms River, NJ- Work crew from Erbe Carting remove a pile of debris that sits in Shelter Cove Park at the east end of Bay Ave. The park is located on the edge of Barnegat Bay. Huge amounts of storm debris sits along the Barnegat Bay after superstorm Sandy destroyed homes, boats, cars, and anything else in its path. Doug Hood/ Staff Photographer 11/28/2012 / DOUG HOOD/ASBURY PARK PRESS

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Sandy's destruction of taxable properties, like this home in Union Beach, means higher taxes for many Shore towns. / TANYA BREEN/STAFF PHOTOGRAPHER

Gov. Chris Christie greets President Barack Obama following superstorm Sandy. In his bid for re-election next year, Christie likely will be judged not by his immediate response after the storm, but how well he oversees the actual rebuilding. / ASSOCIATED PRESS

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During the first two years of Matthew Doherty’s term as the mayor of Belmar, unwelcome outcomes came up zeroes: no layoffs, no gimmicks and, most important, no tax increases. But with his beachfront tax base decimated by superstorm Sandy, the Democratic mayor is pulling that feather from his cap for 2013. The borough will lose about $140,000 in revenue, he said.

“It’s going to be a salary-and-benefits year,” he said, meaning there will not be room in the budget for new vehicles, equipment or nonessential supplies.

“So it’s going to be lean, not because our expenses are so high, but because we’re losing so much revenue,” Doherty added. “And I think that’s the same of every municipality along the coast from Sandy Hook to Cape May.”

Unless the Federal Emergency Management Agency picks up the full tab for the Oct. 29 storm, that will at least be true up and down Monmouth and Ocean counties, experts and town officials said. Budgets will be lean in some departments but expanded in others, including for overtime and cleanup related to the Oct. 29 storm, and the costs will be reflected in next year’s tax bills. With no clarity on whether FEMA would up its reimbursement rate from 75 percent to 90 or even 100 percent, as requested, public officials’ anxiety waxed as the year waned.

“That’s the Grinch that stole Christmas,” said William G. Dressel Jr., executive director of the New Jersey State League of Municipalities. “Hopefully it won’t be a Grinch. Hopefully we’ll all receive pleasant news under our Christmas trees and the average taxpayer won’t be saddled with these costs.”

But don’t count on it.

Sandy’s long-term effects will be revealed in ways fiscal and political, no matter what. It is simply a question of how much.

Seaside Heights Mayor Bill Akers, who has about 15 blocks of famed boardwalk to repair and residents still displaced, said that “in the short-term, (the storm is) definitely going to have a negative effect.” The borough had meetings scheduled with state officials to go over budget options, and was open to outside relief, he said.

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Earlier this month the Borough Council approved an emergency appropriation of $14.7 million to pay for debris removal and rebuilding the boardwalk. Seeing that Belmar, which has similarities to Seaside Heights, received a bid for $6.6 million for its boardwalk repair – far less than the original $20 million estimate – gave Akers confidence that the price tag in Seaside may be lower, possibly easing the burden on taxpayers. Bonds are taken out and paid back long term in order to do just that.

In Seaside Heights, it is the tourists who provide most of the revenue, by an approximate 75 percent to 25 percent ratio to property owners. Balancing the budget will be a particularly vexing problem for tourism-reliant towns that must stay under the 2 percent property tax cap, Akers said. They need both the beachgoers and the residents, but, at winter’s remove, there’s no certainty either will return in full next year.

“Where can you go?” Akers said. “It’s going to be a new road for a lot of municipalities.”

Tax bases destroyed

Toms River township administrator Paul J. Shives said about 20 percent of the town’s tax base was washed off the rolls by Sandy, mostly on the barrier island and waterfront mainland. This will be a three- to four-year problem for the budget, he said, that could shift the tax burden inland, “and that’s not a good thing.” Property values will take a hit, too, he said.

The town’s immediate concern is getting people back into their homes. In order to do that, utilities must be restored. And in order to do that, the debris — mountains of it — must be cleared away.